I think a second reason for insiders to buy is to instill confidence in the company. The size of the buys relative to other buys may be able to shed some light on their motivation.
I follow as you 2 years of insider transactions and look a year after the stock price and try to find a glitch or point who « if this level,ratio,etc append mean positive flag » ….Nothing ,Nothing .. it mean for me ; An insider can miss his own predictions as you and me! !!! So thank you for this video who have same conclusion as i do!! 😊
Interesting that there didn't seem to be a strong positive correlation between 3 or more insiders buying and company performance since 2021. I wonder if there's some kind of intermediary variable that differentiates "accurate" insider buying from insider buying more generally, like relative amount owned or purchased, job title of the insider, relative stock price at time of purchase vs. 52 week range (in the same way stock buybacks can be well- or ill-timed), or something like that? I'd be really interested in future videos on this topic.
Very interesting results. I gave it a thought and possibly the second year's underperformance could be explained by the overly positive reaction of the rest of the market on insider buying itself. So insiders knew something and bought and stock did go up. Then the rest of the market reacts and buys. The stock goes even higher, and then during the second year the market realizes that the good news market was buying was not that great to justify the elevated price.
The 13F filings causes a disconnect in timing of when the insiders actually made the trades and when you learn it happened. The stock could be up a lot after an insider has purchased, thus your entry price could be higher than the insider. One suggestion would be only buying if the price of the stock is at or below the insiders purchase price.
Hey very interesting video!!! It would be cool to see how the results evolve using different timelines. How is the performance if you hold the stocks for only the following three months? How is the performance if you hold them for 10 years?
Results were certainly not intuitive. Curious if insider buys/positive stock returns may correlate to specific sectors (obviously biotech is not a winner but maybe financial or energy?), or perhaps company fiscal health (low debt ratio for example)?
Was there a reason you went with 1-2 year returns? This doesn't seem long, at all particularly for executives - products can be in development for years before they're delivered
I didn't think to look at how returns differed depending on company size, since the wisdom with insider buying is that it's a universal bull indicator regardless of anything else
I think a second reason for insiders to buy is to instill confidence in the company. The size of the buys relative to other buys may be able to shed some light on their motivation.
I was just about to look for papers back testing insider buying. Great video.
I follow as you 2 years of insider transactions and look a year after the stock price and try to find a glitch or point who « if this level,ratio,etc append mean positive flag » ….Nothing ,Nothing .. it mean for me ; An insider can miss his own predictions as you and me! !!! So thank you for this video who have same conclusion as i do!! 😊
Interesting that there didn't seem to be a strong positive correlation between 3 or more insiders buying and company performance since 2021. I wonder if there's some kind of intermediary variable that differentiates "accurate" insider buying from insider buying more generally, like relative amount owned or purchased, job title of the insider, relative stock price at time of purchase vs. 52 week range (in the same way stock buybacks can be well- or ill-timed), or something like that? I'd be really interested in future videos on this topic.
Very interesting results. I gave it a thought and possibly the second year's underperformance could be explained by the overly positive reaction of the rest of the market on insider buying itself. So insiders knew something and bought and stock did go up. Then the rest of the market reacts and buys. The stock goes even higher, and then during the second year the market realizes that the good news market was buying was not that great to justify the elevated price.
Also different time periods would be really interesting
Including only quality stocks would also be interesting
Incredible video. Very logical and practical.
great video please do more analysis videos👍👍
The 13F filings causes a disconnect in timing of when the insiders actually made the trades and when you learn it happened. The stock could be up a lot after an insider has purchased, thus your entry price could be higher than the insider. One suggestion would be only buying if the price of the stock is at or below the insiders purchase price.
Hey very interesting video!!! It would be cool to see how the results evolve using different timelines. How is the performance if you hold the stocks for only the following three months? How is the performance if you hold them for 10 years?
Glad you found it useful 👍
What if you stratify insiders from the board of driectors from the executive board?
Results were certainly not intuitive. Curious if insider buys/positive stock returns may correlate to specific sectors (obviously biotech is not a winner but maybe financial or energy?), or perhaps company fiscal health (low debt ratio for example)?
Interesting
Was there a reason you went with 1-2 year returns? This doesn't seem long, at all particularly for executives - products can be in development for years before they're delivered
We started collecting insider transactions when we created the site so 2021 is the furthest year back we have where the data quality is still high.
Maybe you could exclude the micro cap (and small cap) stocks next time
I didn't think to look at how returns differed depending on company size, since the wisdom with insider buying is that it's a universal bull indicator regardless of anything else
How do we add a column to show the value of the insider purchases? How should we tweak the code in this script?
It could be added. The details are also in the insiders tab